Croatia's deputy PM resigns after private emails released

ZAGREB, Croatia — Croatian Deputy Prime Minister Martina Dalic resigned on Monday after her private email exchanges were published showing an alleged conflict of interest during the restructuring of the country's largest private company.

She said at a joint media conference with Prime Minister Andrej Plenkovic that she was resigning to avoid being a burden for the government amid pressure from coalition partners and the opposition.

"Personally, I have done nothing wrong, immoral or illegal. But the (public) perception is what it is," Dalic said.

Dalic, who is also the economy minister, has led the government drive to save retail and food producer Agrokor, which was placed under state administration in April 2017 after it accrued huge debt.

The independent Index.hr news portal last week and on Monday published numerous emails from her private Hotmail account to legal and financial experts she consulted with while drafting an emergency law to save Agrokor from bankruptcy. Some of those experts were later hired as consultants, for huge fees, when the government took over the company, prompting the conflict-of-interest claims from the opposition.

Dalic called for an investigation to determine how her email correspondence was made available to the portal, saying it was a "criminal act" according to Croatian laws.

Plenkovic praised Dalic's role in preventing the Agrokor crisis from turning into a "tsunami" for the Croatian economy. He expressed regret at her resignation.

"It was an extraordinary crisis that called for extraordinary action," Plenkovic said. "I believe that from the point of view of the state, we fulfilled our strategic goal and I can say we are content."

The company, which employs 60,000 people throughout the Balkans and accounts for 15 percent of Croatia's GDP, collapsed under the weight of 6 billion euros ($7 billion) in debt, including a disputed sum owed to two Russian state-run banks, Sberbank and VTB. It was put into state administration a year ago.

Agrokor's creditors have agreed on draft debt-settlement terms, which provide a framework to avoid bankruptcy.

The plan includes a proposed corporate restructuring that would in effect put the two Russian banks in control of the company — prompting fears in Croatia that the Kremlin has been strategically trying to increase its political influence in the European Union's newest member.

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